DRIVING THE WEEK — SENATE PANEL TO MOVE ITS DEFENSE SPENDING BILL: The Senate Defense Appropriations Subcommittee takes up its fiscal 2015 defense spending bill tomorrow morning, with the full appropriations committee set to approve the measure on Thursday. The appropriations panel is the last of the four congressional defense committees to get to work this year on its annual defense legislation — and it has some big decisions to make.

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First and foremost: What to do about the F-35? Lockheed Martin’s fifth-generation fighter fared well in the House version of the defense spending bill, which would fund 38 of the jets next fiscal year — four more than the Pentagon requested. But the program faces a steeper climb in the Senate, for two reasons. First, the F-35 is in the middle of a public-relations crisis, forced to postpone its scheduled international debut in the United Kingdom because of a fleet-wide grounding that’s still in effect after a runway fire last month.

The engine fire has created an opening for F-35 critics, who are urging Senate appropriators to take a hard look at a program that’s long seemed politically invincible even as its costs have ballooned. “Imagine the shock and awe if some member were to offer a meaningful amendment requiring the F-35 to be tested — actually imposing ‘fly-before-buy’ — before a few hundred more mistake-laden jets are produced,” writes Winslow Wheeler of the Project on Government Oversight. http://bit.ly/1klVfZz

The second factor working against the F-35 in the Senate is that SAC-D Chairman Dick Durbin is from Illinois — where Boeing is headquartered. Boeing and Lockheed are locked in a lobbying war, both pushing for additional funds for their rival aircraft programs. Boeing advocates have circulated letters on Capitol Hill arguing that any additional funds for tactical aviation should go toward the company’s EA-18G Growler program, which could see its production line close in 2016 without more orders.

Other big decisions facing SAC-D include: whether to block the Air Force’s proposed retirement of its A-10 Warthogs, as the House bill would; whether to intervene in the Army’s Armored Multi-Purpose Vehicle competition, which has sparked a fight between contractors BAE Systems and General Dynamics; and whether to include funds to begin planning the nuclear refueling of the USS George Washington aircraft carrier.

THE LATEST ON THE F-35’S STATUS — NO FUNDAMENTAL FLAW, via Andrea Shalal of Reuters, from London: “The engine failure that has grounded the entire fleet of Lockheed Martin Corp F-35 fighter jets was caused by ‘excessive’ rubbing of fan blades in the plane's Pratt & Whitney engine, but does not appear to be a fundamental design flaw, the Pentagon's chief weapons buyer said on Sunday. Defense Undersecretary Frank Kendall told reporters on Sunday there was still a chance that the grounding order could be lifted in time for the F-35 to make its international debut at the Farnborough air show.

“Organizers of the show confirmed that the F-35 would not appear on Monday, but said it could still arrive and fly later in the week.” http://reut.rs/1nwk8qi

HAPPY MONDAY AND WELCOME TO MORNING DEFENSE, where we’re welcoming reporter Jen Judson to the POLITICO Pro Defense team. Judson, who starts today, comes from Inside Washington Publishers, where she covered Army programs. Follow her on Twitter @JenJudson

THE WEEK AHEAD — WINNEFELD, WORK TO THE HILL: Vice Chairman of the Joint Chiefs Adm. Sandy Winnefeld and Deputy Defense Secretary Bob Work are testifying at several hearings this week on the Pentagon’s $59 billion request next fiscal year for supplemental war funds, called the Overseas Contingency Operations account. We expect congressional defense hawks to ask the Pentagon officials whether the amount is too little to support the drawdown in Afghanistan — and war doves to ask whether the amount is too much, given the administration’s plan to leave fewer than 10,000 U.S. troops in Afghanistan next year.

The first hearing is a closed session at 8 a.m. tomorrow before the House Defense Appropriations Subcommittee. Winnefeld and Work are also scheduled to testify in open sessions Wednesday before the House Armed Services Committee and Thursday before the House Budget Committee.

And the Senate Armed Services Committee is holding its confirmation hearing on Thursday for Gen. Joseph Dunford, nominated to be the next Marine Corps commandant.

DUNFORD TO INHERIT MARINE CORPS AT A CROSSROADS, via POLITICO’s Philip Ewing: “Many leathernecks might argue there’s no such thing as a bad day inside the United States Marine Corps — but even they might also admit there have been better times than this. [Dunford], nominated to become the 36th commandant of the Marines, is set to inherit the smallest of the Defense Department’s military services at a time when it’s getting even smaller. It’s trapped in a budgetary straitjacket imposed by Congress. And it’s struggling with goals as different as getting more women into front-line units and determining how to build a new amphibious vehicle.

“But insiders and outsiders alike say Dunford, likely to enjoy a warm reception at his confirmation hearing before the Senate Armed Services Committee this week, is prepared for the challenge. He’s coming off a more than 16-month tour as the top commander in Afghanistan, where he’s credited with helping preserve the gains of the Afghan National Security Forces.” http://politico.pro/1jqyaKe

TOP TALKER — ‘BERGDAHL SET TO RESUME LIFE ON ACTIVE DUTY,’ via Eric Schmitt of The New York Times: “Six weeks after being released from five years in Taliban captivity, Sgt. Bowe Bergdahl is expected to return to life as a regular Army soldier as early as Monday, Defense Department officials said late Sunday. Bergdahl has finished undergoing therapy and counseling at an Army hospital in San Antonio, and will assume a job at the Army North headquarters at the same base, Fort Sam Houston, the officials said.

“He is also expected to meet with Maj. Gen. Kenneth R. Dahl, the officer who is investigating the circumstances of Bergdahl’s disappearance from his outpost in Afghanistan in 2009.” http://bit.ly/1mNFoHk

-- Attorney General Eric Holder said on ABC's "This Week" he's concerned that bomb-makers in Syria could be developing explosives small enough to fit in laptops. http://politi.co/1m7KGcm

MAKING MOVES

-- NORTHROP PROMOTES TWO: Northrop Grumman is promoting Corporate Vice President Mark Caylor to president of enterprise services and chief strategy officer. Meanwhile, Vice President of Investor Relations Stephen Movius is becoming corporate vice president and treasurer. "Mark and Steve are proven leaders who have provided outstanding strategic and financial oversight for Northrop Grumman," Northrop CEO Wes Bush said in a statement.

-- DYNCORP GETS NEW CEO, via POLITICO’s Marjorie Censer: “S. Gordon Walsh will become chief executive of defense contractor DynCorp International later this month, the company said …. Walsh will take over for Steven Gaffney, who has served as DynCorp's CEO since August 2010. Chan Galbato, lead director of DynCorp parent company Delta Tucker Holdings, said in the announcement that Walsh will improve DynCorp's competitiveness and help it expand into new markets.”

SPEED READ

-- Tens of thousands of Palestinians are fleeing Hamas-ruled Gaza after the Israeli government warns them to leave or risk their lives. Reuters: http://reut.rs/U8qEb6

-- Russia warns of “irreversible consequences” after it claims a Ukrainian army shell killed one person in the southern region of Rostov. Bloomberg: http://bloom.bg/1nlnqrv

-- A classified assessment says many Iraqi military units have been infiltrated by “Sunni extremist informants” or “Shiite personnel backed by Iran.” The New York Times: http://nyti.ms/1jHhaQ8

-- Japan is looking to buy MV-22 Ospreys, which have a complicated history in the country. The Washington Post: http://wapo.st/1rkuAl5

-- Defense industry partners agree to contribute $170 million on internal research and development to help bring down the price of the F-35. Defense News: http://goo.gl/w25Gc0

-- Contractors are increasingly worried about bid protests, even though the numbers didn’t increase last year. POLITICO Pro: http://politico.pro/U6NwYo

-- The Navy continues to experiment with 3D printing technology that would allow sailors to fabricate replacement parts. Military Times: http://goo.gl/W9sRPq

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Authors:

About The Author

Austin Wright is a senior defense reporter based at the Pentagon covering budget, policy and national security issues. He has been with POLITICO since 2011 and was previously a web producer and author of the widely read newsletter Morning Defense.

Before POLITICO, Wright worked for National Defense magazine, interned at The Chronicle of Higher Education and taught sixth-grade English at Kramer Middle School in Washington.

Wright hails from Richmond, Va., and graduated in 2009 from the College of William and Mary, where he was editor of the student newspaper, The Flat Hat. He lives in Northern Virginia with his wife, Leanne, and their dog, Kernel.